Alberta manufacturers, retailers struggle with fallout from blockades on CN Rail lines

Alberta manufacturers, retailers struggle with fallout from blockades on CN Rail lines
“The interruption is a significant concern to our clients, who depend on Canadian manufacturing,” said David McHattie, the institutional relations director of Tenaris, a manufacturer of steel pipes in Calgary and Nisku.

“This is a challenge that’s beyond just an Alberta challenge. This is a national challenge and we’d like the federal government to step in and restore the rule of law and help Canada’s manufacturing and energy supply chain work effectively.”

Anti-pipeline demonstrators have ground freight traffic across most of Canada to a halt, with CN Rail announcing a “progressive and orderly shutdown of its Eastern Canadian network” Thursday and suspending all transcontinental trains.

The protesters are forming blockades in solidarity with the Wet’suwet’en First Nation. Hereditary chiefs from the First Nation oppose the $6.6-billion Coastal GasLink pipeline project, which runs through parts of the traditional Wet’suwet’en territory in northwest British Columbia. Elected councils support the pipeline.

The blockades have led to a backlog of freight trains and vessels, with dozens of ships sitting idle, waiting to be loaded at the Port of Vancouver. Many businesses are turning to trucking companies to fill some of the gaps left by the CN Rail closures, but the option comes with logistical and financial challenges.

“Today we have inventory and we have the ability to ship things by truck, but this will be at a higher logistics cost,” said McHattie, adding that shipping by truck will cost the business about 10 per cent more than rail.

“It’s not sustainable in the long run.”

According to Karl Littler, senior vice-president public affairs of the Retail Council of Canada, the stoppage will likely be felt most strongly for time-sensitive items, like fresh food , but other products could also be impacted.

“It’s important to think about things like fire alarms, hygiene products and infant formula. A lot of that stuff moves on rail,” Littler said. “Eventually there will be shortages and completed stock. There’s no major alternative transportation network.”

The impact will likely be most notable in rural communities far from the United States border.

“If you’re up north, in Fort McMurray, or somewhere like that, it’s going to be harder,” Littler said. “Most of the work is done by rail and the last bit is done by trucks, and there’s not enough trucks to service all of this. It’s going to be a challenge.”

The stoppage is resulting in expanded demand that Alberta’s trucking industry says they’re having difficulty filling.

Chris Nash, president of the Alberta Motor Transport Association, says there’s less demand for short-distance deliveries as companies try to make up for rail outages.

“With the CN Rail blockades, it’s probable long-haul carriers are seeing increases in order to keep product moving,” Nash said. “In turn, short-haul carriers might be seeing declines in companies providing drayage.”

Non-oil and gas businesses are frustrated they’ve been caught up in a pipeline protest.

“In a sense, you feel like you’ve been kind of sideswiped by it,” Littler said.

Amid pressure to end the blockades, Prime Minister Justin Trudeau said Friday the disruptions must be resolved through dialogue, not by ordering in the police, making it clear the federal government had no plans to make the RCMP dismantle the blockades.

Protests continued in B.C. and Ontario Friday, with activists planning to shut down government offices in Victoria. Indigenous leaders in B.C.’s northwest have invited federal and provincial politicians to meetings to find solutions, and said they would ensure a blockade of a CN track near New Hazelton, B.C., would come down during talks.
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